US Power PJM Board Approves Reliability Backstop Procurement and Connect and Manage Framework

Research evidence excerpt

US Power PJM Board Approves Reliability Backstop Procurement and Connect and Manage Framework

Global Research

28 July 2026ab

US Power Equities

North AmericaPJM Board Approves Reliability Backstop

Procurement and Connect and Manage Electric Utilities

Framework William Appicelli,AnalystCFA

william.appicelli@ubs.com

+1-212-713 1414

What's Our Take? Gregg Orrill

Analyst

PJM reached milestones with its Board completing reliability backstop and connect and gregg.orrill@ubs.com

manage rules for filing with FERC. The proposed rules are in line with expectations, in +1-212-713 1064

our view. We believe setting market rules will help lead to contracts and support investor

Steve Ludwick

sentiment for IPPs. The documents posted show PJM responding to a projected power

supply shortage by requiring large new electricity users to help ensure adequate steve.ludwick@ubs.com

generation resources are available, while also creating a temporary reliability +1-212-713 5073

procurement program. We don't see new generation as a threat to the existing installed

Allison Paik

IPP generation base given the amount of new demand, and see clarity of the rules as a

Associate Analyst

benefit that can let market participants move forward with their power procurement allison.paik@ubs.com

strategies. IPP valuations remain compelling and we reiterate Buy ratings on NRG, VST, +1-212-713 1078

and CEG.

What Happened?

Yesterday, post close, PJM's Board posted its reliability package aimed at addressing data

center-driven load growth and tightening reserve margins which includes a Reliability

Backstop Procurement, a "Connect and Manage" requirement for new large loads, and

new cost-allocation mechanisms that place greater responsibility on customers driving

demand growth.